Asset management firm Franklin Templeton sees growing potential in Solana to cement itself as the third-largest cryptocurrency in the market.
The asset manager with over $1.5 trillion in assets under management (AUM) took to X on May 2 to praise Solana, currently the fifth largest cryptocurrency by market cap.
“Solana’s growth is likely to continue because it is well-positioned to capture the next wave of crypto adoption, solidifying itself as the third major crypto asset after Bitcoin (BTC) and Ethereum (ETH),” the firm said.
In the note shared on X, the firm revealed that Solana was able to grab a part of the cryptocurrency acceleration during Q4 2023 through its round of native airdrops, which subsequently propped up the whole SOL ecosystem.
Franklin Templeton also mentioned the network’s robustness. Solana was severely affected by FTX’s meltdown in 2022 but managed to recover with solid adoption numbers. Owing to its low fees and scalability, Solana also capitalized on the memecoin craze, creating popular meme tokens, including BONK and WIF, which have remained among the top 100 cryptocurrencies by market valuation.
The Wall Street giant expects Solana to expand its reach as its performance and network effects position it to capitalize on the next crypto trends. The network is home to various initiatives deploying use cases, including payments, decentralized physical infrastructure network (DePIN), and compression non-fungible tokens (NFTs), which Franklin Templeton believes will help the blockchain usher in the next wave of adoption.
The firm’s note stated:
“Crypto enthusiasts are wondering what the next big thing in crypto might be… While we don’t know the precise answer, we’d argue there is a strong chance it happens on Solana.”
While the institution acknowledged that increased activity had caused operational problems in Solana, it also recognized the efforts of developers working to fix these issues as soon as possible.
On Oct. 31, Dan Albert, the executive director of the Solana Foundation, revealed the launch of the testnet for Firedancer, an anticipated scaling solution for Solana.
The project, spearheaded by web3 development firm Jump Crypto since last August, is expected to enhance the network’s speed, reliability, and validator diversity, with a mainnet launch projected for the first half of 2024.
